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CBS to divest 81 per cent stake in CBS Outdoor Americas
MUMBAI: In a final step that is likely to separate CBS Outdoor from it, CBS Corp has announced plans to divest its 81 per cent ownership in the billboard advertising company CBS Outdoor Americas, which split off from the media giant earlier this year.
The move is termed as the final step in the separation of the unit following its initial public offering in April.
CBS Corporation CEO and president Leslie Moonves said, “We are very pleased to be taking this step toward completing our strategic transaction. We fully believe that CBS Outdoor will continue to be successful as a stand-alone company. And for our part, CBS Corporation can focus on what we do best, which is invest, produce and distribute premium content across all platforms and all around the world.”
CBS Outdoor Americas leases advertising space on out-of-home advertising structures. On completion of the split-off, CBS outdoor intends to transform into a real estate investment trust. CBS owns 97 million shares of CBS Outdoor common stock, which represents around 81 per cent of the outstanding common stock of CBS Outdoor.
CBS Outdoor CEO Jeremy Male added, “CBS has been a great owner for many years, but as a wholly independent company, we believe we can take CBS Outdoor to new heights. Our expected REIT conversion is an opportunity to create additional long-term value for our shareholders. We’re very excited about our future.”
As per reports, CBS shareholders will have the opportunity to exchange all, some or none of their shares of CBS Class B common stock for shares of CBS Outdoor common stock at a 7 per cent discount, subject to an upper limit of 2.1917 shares of CBS Outdoor common stock for every share of CBS Class B common stock. If the upper limit is not in effect, tendering shareholders would receive approximately $107.53 of CBS Outdoor common stock for each $100.00 of CBS Class B common stock accepted in the exchange offer.
The final exchange ratio will be announced on 9 July unless the exchange offer is extended or terminated.
Goldman, Sachs & Co and Morgan Stanley will serve as the dealer managers for the exchange offer, and J.P. Morgan will serve as a financial advisor.